Tag Archives: american dream

Zack Shepard Keeps the Long-Term in Close Sight Despite an Unpromising First Quarter for Stocks

Zack Shepard, vice president of communications at Matson Money, Inc., spoke with Neil Cavuto on Fox Business News about the market’s unimpressive first quarter in April 2014.  Holding true to his beliefs and real world experience as a financial investor and coach, he told viewers that an unimpressive first quarter is not unprecedented.

It has happened before, it’s happening now, and it will happen in the future.  But despite this trend, the market, as history shows, tends to triumph in the long run.

At the beginning of the segment, Cavuto shows the year-to-date percentage losses/gains of major markets including Dow Jones, Standard & Poor’s, and Nasdaq. According to Fox Business News, the loss/gains were -1%, 1%, and 1%, respectively.

Categorical year-to-date gains and losses of the first quarter included:

  • Energy sector – 0.95%
  • Technology sector – 1.1%
  • Financial sector – 0.86%
  • Healthcare – 5.23%
  • Utilities sector – 2.94%

When Shepard was asked what he made of the market’s first quarter and the future, he said he looked at the matter historically.  In his research, he found no correlation between first quarter market activity and market activity in future quarters.

Yet Cavuto asked: “What does the rest of the year look like as a result of the opening quarter?”

“I think investors should be looking out further than the rest of the year,” said Shepard.  “I think investors should be looking for a lifetime.  And for me, I think investors are looking at fear right now.

“My advice to them is to feel the fear and invest anyway.”

Invest long-term.  Invest in equities.  And invest in capitalism to seek your American dream.

Is The American Dream Dead?

The problem with the American Dream is that people don’t believe in it anymore. There’s a recent poll by CNN and it showed that 6 out of 10 people no longer believe in the American dream. Now when I was little my dad taught me about the American dream and for me it means just two things. One is that if you work hard, you save and invest you can have a great lifestyle, and you can have a great family time together. And the other thing is that, America’s about progress so that the future generation actually has more opportunity and growth and prosperity than the generation before.

And I think two things, the crashes recently in the last 15 years and still the sluggish, if not anemic, or almost dead economy, you’re really destroying a lot of people’s hope in the American Dream.

One thing advisers can do to help investors reclaim the American dream is to stop speculating and gambling with their money. There’s reams of academic information that shows that stock picking, market timing and track record investing are nothing but rank speculation and that’s why so many investors have lost faith, yet they’ve either tried to pick stocks and be in the market at the right time and they’ve panicked when markets are down. Discipline and building broad, diversified portfolios so they can have the ability to create real wealth over time, that’s the first step to creating the American dream.

Over the last 10 years, I think most advisers are doing what they’ve always done over the last 30 years. One is to chase hot sectors. So a couple years ago everybody’s dumping money into tech stocks or dumping money into commodities. And the other thing is, panicking when markets crash. You know, everyone knows the simple rules of investing. Buy equities, hold them long term, diversify and then buy when it’s low and sell when it’s high by rebalancing your portfolio. But nobody wants to do it.

2008 and 9 is a perfect example. A lot of people panicked when the market was down 50%, they’re still on the sidelines setting and waiting, for clear signals of when to get in.

20 years ago we used to tell investors, just don’t watch the news, turn off the news, you know. All that noise and all that excess, that’s messing up your peace of mind and causing you to have dysfunctional behavior. The problem is you can’t turn it off today because you got the internet. Even if you go to take your kids to eat, or your family out to dinner you got the big flat screen TVs showing the market up or down and some talking heads scaring you. So, you can’t just turn it off.

One of the things we’ve been telling advisers and investors to do is to have regular coaching meetings at least once a month where advisers are educating their investors. Almost, think of it like a weight watchers meeting, if you’re not proactive in training and educating people, they’ll just slide back into dysfunctional behavior.

What’s really neat about the symposium is just really the culmination of a dream that started about 20 years ago, which was to build a community of advisers and investors together, in our field that’s really rare because usually the information is either just for advisers and sometimes, and these symposiums are big conferences, they don’t want the investors to hear this stuff. On the other hand sometimes it’s just focused on the investors. And so here what we’ve done is build a community to show, hey we can all talk about these concepts and issues and the challenges together, we don’t have to stay separated from each other.

So we’re really excited about that. We think it’s one of the first ground breaking things that this industry has ever seen together like that.

One of my general messages is, yes there’s challenges, yes we want to overcome those, but hey things are pretty doggone good, we should appreciate them and be grateful for what we have here.